Cambridge Family Law Practice

The High Court has rejected the inclusion of previously incurred legal debts in a financial application made by a party to a divorce.

DH v RH concerned contested divorce proceedings that had continued for more than two years. The wife applied for ‘maintenance pending suit’ and a ‘legal services payment order’ before a ten- day final hearing scheduled for later in the year.

Maintenance pending suit refers to maintenance paid on a temporary basis before a divorce settlement is finalised. Meanwhile, a legal services payment order or LSPO is a court order usually requiring the wealthier party in a divorce to contribute to the legal costs incurred by the other party in order to allow a fair settlement to be reached.

At the time of the hearing, the wealthy former couple, who divorced in 2020, had spent £2 million on legal costs. But the wife’s debts were considerably higher: she owed large sums to both her current and former solicitors, and had also still to repay a litigation loan. Her costs had been accumulated in an unsuccessful attempt to prove that her former husband had engaged in ‘non-disclosure’ – i.e., he had not fully declared his assets at the beginning of the divorce process.

She now sought £500,000 for future legal costs, as well as payment of her outstanding costs, saying her current solicitors would not continue to act for her if they weren’t paid. Her current solicitors had even reached an agreement with the wife’s previous solicitors to include their outstanding costs in the LSPO application – contrary to an established legal principle that historic costs cannot normally be added.

Sitting in the Family Division of the High Court, Mr Justice MacDonald, referred to the “quite eye watering sums” spent by the former couple on their extended dispute. He described the inclusion of the previous solicitor’s fees as:

“…a rather transparent artifice to try to bring the wife’s former solicitors within the circumstances that are understood by matrimonial lawyers to justify the inclusion of historic costs in an LSPO.”

But, he insisted:

“…the inclusion of such historic costs in an LSPO would be unprecedented.”

The Judge continued:

“Whilst there will remain a risk, assumed by the solicitor, that the client will not pay the sums owed for past work, once funding under the LSPO is in place there is no risk that the client will not pay the sums owed for further work, provided the solicitor adheres…to the stipulation of the court as to the type of legal services provided, the period over which they are provided and the purpose for which they are provided under the LSPO.”

Therefore, the LSPO sought by the former wife could not and should not include the historic costs sought. The wife’s current solicitors were under no obligation to the previous firm and had provided no sworn evidence to the contrary.

Mr Justice MacDonald noted the wife’s profligate spending on legal services to date and her general failure to specify the alleged deficiencies in the husband’s financial declarations.

The wife was granted her LSPO but the sums granted were significantly reduced from those sought, with the Judge rejecting a number of the claims made by her and her legal team. But she had, he acknowledged, a stronger case for maintenance pending suit:

“The wife has plainly established her need for maintenance pending suit. She has no current employment and is required to maintain herself and the children of the family pending the determination of these proceedings.”

She was granted interim maintenance of a little over £141,000 per annum.

Kathryn Evans, one of the partners here at Cambridge Family Law Practice, notes: “one of the considerations for a Judge when looking at an application for a Legal Services Payments Order is whether or not the applicant’s current solicitor would continue to act if the payment wasn’t made. It’s unsurprising the Judge concluded that non-payment of a previous solicitor’s fees would not deter the wife’s current solicitor from acting”.

Read DH v RH in full here.